Archive:Recruitment and personnel selection services statistics - NACE Rev. 1.1
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- Data from January 2009. Most recent data: Further Eurostat information, Main tables and Database.
This article presents the European Union structural business statistics for NACE Group 74.5, which includes personnel search, selection referral, head-hunting and job placement services. Personnel services may be supplied to persons looking for work or to an enterprise trying to hire. The data presented also cover labour-contracting activities (for example, temporary work agencies); however, they do not comprise farm labouring or the performing arts.
Main statistical findings
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Personnel services have grown mainly as a consequence of the outsourcing trend, using the flexibility and expertise provided by enterprises in this sector (for example, knowledge of the labour market and selection procedures) instead of trying to employ personnel directly.
On 27 June 2007, the European Commission proposed in a Communication the establishment of eight common principles of flexicurity, a policy approach that gains growing importance as an instrument that combines labour market flexibility with employment security and the need to respect workers rights and working conditions. This policy is a response to the challenges posed by globalization, with the aim of making EU labour markets more flexible while providing employment security at the same time. In this framework, enterprises acting in personnel services are directly concerned.
Structural profile
The EU’s personnel services sector (NACE Group 74.5) generated EUR 96.2 billion of value added in 2006 from EUR 127.9 billion of turnover, equivalent to 10.8 % of the wealth that was created in the business services sector (NACE Divisions 72 and 74) and 7.3 % of the turnover. In turnover terms this was the smallest of the business services activities, and it was the second smallest in value added terms. However it was with respect to employment that the 71.1 thousand enterprises in the personnel services sector made their greatest contribution: the personnel services workforce consisted of 3.8 million persons, equivalent to 17.1 % of the business services total, making it the third largest workforce within business services. The significant differences in the contribution of personnel services to the business services total depending on the indicator studied can be largely explained by the nature of a much of this sector, namely, to employ people to undertake work for clients in other sectors.
Among the Member States, close to one third of the EU’s value added came from the United Kingdom (32.1 %), the largest market for personnel services, as well as the largest employer. France and Germany were respectively the second and third largest contributors, both in terms of value added or employment. These three Member States dominated this sector, collectively accounting for 69.7 % of EU value added; for comparison, their share within business services was 61.2 % and within the non-financial business economy as a whole it was 53.5 %. The Netherlands was the fourth largest Member State in personnel services, ahead of both Italy and Spain. In particular, the size of the Dutch workforce was remarkable, with over half a million persons employed in personnel services. In value added terms the United Kingdom and France were the most specialised in this sector, both registering 2.9 % of their non-financial business economy (NACE Sections C to I and K) value added in this sector. Cyprus, Bulgaria (both 2005), Greece, Latvia and Lithuania were the least specialised in this sector, all generating 0.2 % or less of their non-financial business economy value added in personnel services.
Product analysis and type of personnel
A breakdown of turnover by product for the personnel services sector shows that in 2005 supply services of personnel generated the largest share of turnover in most of the Member States for which data are available, as compared with placement services. Only in Latvia and Lithuania did the placement services of personnel (such as executive search services) generate more than half of the total sales. It should be borne in mind that turnover for placement services tends to correspond to a fee for the placement, whereas the turnover for the supply of personnel involves both a fee for arranging the supply as well as the payments made to the personnel supplied.
Expenditure and productivity
In several respects concerning expenditure and productivity the EU’s personnel services sector is atypical for business services. This sector recorded by far the lowest investment rate, just 1.2 % in 2006, from investments valued at EUR 1.2 billion. This was not only the lowest rate within business services, but it was also the lowest investment rate of all NACE groups within the non-financial business economy in 2005 or 2006. In contrast, expenditure on personnel costs was high, as these costs accounted for 72.6 % of all operating expenditure in this sector; this was 1.8 times as high as the average share in business services and 4.5 times as high as the average share for the non-financial business economy, and unsurprisingly was the highest share for all NACE groups within the non-financial business economy in 2005 or 2006.
Apparent labour productivity and average personnel costs were both lower in the EU’s personnel services sector than respective averages for business services in 2006. Indeed, apparent labour productivity was EUR 25.4 thousand per person employed for personnel services (EUR 40.2 thousand for the business services) and average personnel costs were EUR 21.6 thousand per employee (EUR 31.1 thousand for business services), and in both cases these were the second lowest levels among the business services sectors. It should be noted that these ratios are to some extent influenced by the high incidence of part-time and temporary work in the personnel services sector, as both of these measures are based on simple head counts of persons employed or employees. These characteristics of the personnel services’ workforce do not affect the wage adjusted labour productivity ratio as much, but nevertheless this ratio was just 117.5 % for personnel services in 2006, the lowest ratio among all of the business services sectors.
Data sources and availability
The main part of the analysis in this article is derived from structural business statistics (SBS), including core, business statistics which are disseminated regularly, as well as information compiled on a multi-yearly basis, and the latest results from development projects.
Other possible data sources include short-term statistics and the Labour force survey. In addition, use has also been made of specialist sources for particular areas, notably transport, energy, research and development, environment, tourism and information society statistics.
Context
The freedom to provide services and the freedom of establishment are central principles to the internal market for services and are set out in the EC Treaty. They guarantee EU enterprises the freedom to establish themselves in other Member States, and the freedom to provide services on the territory of another EU Member State. The Directive on services in the internal market (COM(2006)123)aims to achieve a genuine internal market in services, removing legal and administrative barriers to the development of services activities between Member States. The Directive was to be implemented by Member States by the end of 2009 at the latest. As well as covering most business services (with the notable exception of services of temporary work agencies), the Directive applies to a wide variety of services including industrial and construction activities, as well as distributive trades, hotels and restaurants, travel agents, real estate and renting services.
Further Eurostat information
Publications
Dedicated section
Other information
- Directive 2006/123 of 12 December 2006 on services in the internal market